The highest
bid of Rs.2,26,00,000/- given by respondent - M/s. Chandigarh Corporate Guides
Ltd. in the open auction conducted by the Municipal Corporation, Chandigarh
(appellant No.1 herein) in respect of SCO No.164- 165 situated in Sector 9C,
Chandigarh was accepted by the competent authority. In terms of the condition
of auction, the respondent was required to deposit 25% of the premium within 30
days of the auction and the balance 75% in 3 equated yearly installments of
Rs.71,99,192/- along with interest @ 18%. Later on, the annual equated
installment was revised as Rs.69,06,322/-. The respondent paid 25% of the
premium i.e. Rs.57,25,000/- on 29.4.1998. Thereafter, allotment letter was
issued in favour of the respondent by Assistant Commissioner, Municipal Corporation,
Chandigarh (appellant No.2 herein). As the respondent failed to pay the ...2/-
- 2 - balance amount together with interest on due dates, appellant No.2 after
issuing notice to the respondent and hearing the parties passed order dated
12.7.2001 whereby, he cancelled the lease of the site and forfeited 10% of the
premium, interest and ground rent. On an appeal preferred by the respondent,
Joint Secretary, Finance, Union Territory Chandigarh set aside the order of
cancellation of lease and restored the site to the respondent subject to the
condition that it shall pay the outstanding dues within 4 months. This was
subject to the rider that if the respondent fails to stick to the time
schedule, the order of the Assistant Commissioner shall become operational.
Similar order was passed by Advisor to the Administrator, Union Territory
Chandigarh who disposed of the revision of the respondent by giving it 3 months
time for payment of the outstanding dues.

On an
application made by the respondent, the Advisor extended the time specified in
the revisional order. Despite this, the respondent did not deposit the balance
amount.

Instead,
it raised dispute regarding correctness of the statement of accounts furnished
by the Municipal Corporation.

Finally,
the respondent filed a writ petition for setting aside the order of
cancellation of lease passed by appellant No.2 herein as also the appellate and
revisional orders passed by Joint Secretary, Finance and Advisor to the
Administrator, Union Territory Chandigarh respectively.

The High
Court did not go into the legality or otherwise of the order by which the
respondent's lease was cancelled. The High Court also did not consider whether
the conditional orders of restoration of lease passed by the appellate and
revisional authorities were legally correct and disposed of the writ petition
by a short order. The High Court took cognizance of the statement made by
counsel appearing for the writ petitioner that all outstanding dues have been
paid and directed the appellant herein to communicate in writing the
outstanding dues which are still payable by the writ petitioner and directed
the latter to clear the outstanding dues within 3 weeks of such communication.
The High Court concluded that if the amount is deposited, the order of
resumption shall be treated as non est.

We have
heard learned counsel for the parties. In our view, the procedure adopted by
the High Court for disposing of the writ petition is wholly unknown to law.
When the order for cancellation of lease was challenged, the High Court was
duty bound to decide whether the order passed by appellant No.2 i.e. Assistant
Commissioner, Municipal Corporation, Chandigarh was legally correct. The High
Court should also have examined and adjudicated upon the legality of the
conditions imposed by the appellate and revisional authorities for restoration
of the site to the respondent.

Since,
the impugned order has been passed without examining the vital issues raised by
the parties, the same cannot be sustained.

Accordingly,
the appeal is allowed, impugned order is set aside and the matter is remitted
to the High Court for deciding the writ petition afresh in accordance with law
after giving opportunity of hearing to the parties.

Needless
to say that we should not be misunderstood to have expressed any opinion one
way or the other in relation to the merits of the writ petition filed by the
respondent.